AXT Inc. Q4 Revenue Falls to $23M, InP Backlog Hits $60M
AXT Inc. reported a Q4 non-GAAP net loss of $2.6M on $23.0M revenue, down from $28.0M in Q3, with gross margin slipping to 21.5% versus 22.6% quarter-on-quarter. The company’s InP wafer backlog topped $60M as export permit bottlenecks persisted, while cash rose $97.2M after a $93.9M stock offering.
1. Q4 Financial Results
AXT Inc. posted a non-GAAP net loss of $2.6 million in Q4 2025 on $23.0 million revenue, down from $28.0 million in Q3. Non-GAAP gross margin fell to 21.5% from 22.6% sequentially, while GAAP operating loss widened to $3.8 million. Revenue breakdown included $8.0 million InP, $7.0 million GaAs and $7.6 million from raw material ventures, with Asia Pacific accounting for 81.5% of total sales.
2. Export Permit Impact and Q1 Outlook
Management cited fewer export permits as the primary constraint on fourth-quarter shipments and said permit variability complicates forecasting. As of the call, $26 million of Q1 revenue is tied to permits already secured or not required, and sequential revenue growth is expected as InP demand for AI data centers strengthens.
3. InP Backlog and Capacity Expansion Plans
The InP wafer backlog surged past $60 million, driven by longer-term orders as customers plan for extended lead times. AXT has increased capacity by 25% since October and aims to double substrate output by end-2026, with an initial $30 million brownfield expansion and potential further scaling in 2027 requiring $100–150 million.
4. Cash Position and Inventory Management
Cash, cash equivalents and investments climbed to $128.4 million at year-end, up $97.2 million sequentially following a $93.9 million stock offering. Accounts receivable fell by $2.6 million while net inventory rose to $81.7 million, which management plans to reduce in coming quarters.